Businesses have various assets that help them function daily. One type of asset is real estate, which can be used for office, retail, or manufacturing. When a business decides to sell its real estate assets, there are a few key things they need to know to get the best possible price.
In some cases, business owners sell some of their assets to raise money for other purposes. For example, they may need to invest in new equipment or expand their operations. Or, they may be selling the business entirely and want to maximize their profits.
Some of the real estate assets they own include the land, the building, and any improvements that have been made to the property. A business can also hold a residential property, which can be used as an employee perk or to generate rental income.
Here are the top things to consider when selling a real estate property:
The value of the property
This is determined by various factors, such as the property’s location, size, and condition. A business owner should have a good idea of their property’s worth before listing it for sale.
If it’s a residential property, a home realtor can help determine its value. A business owner can consult with a real estate appraiser or broker for commercial properties.
The costs of selling
Various costs are associated with selling a property, such as commissions, fees, and closing costs. A business owner should be aware of these costs to factor them into their asking price.
The time frame
Depending on the market conditions, it can take anywhere from a few weeks to several months to sell a property. A business owner should have a realistic timeline when they put their property up for sale.
Preparing the property for sale
Once a business owner has decided to sell their real estate assets, they need to take some steps to prepare the property for sale. This includes cleaning and repairing the property so it’s in good condition when potential buyers look at it.
The business owner should also consider their personal belongings on the property. They may want to remove any furniture, equipment, or other items they don’t want to sell with the property.
Selling the property
Once the property is ready, it’s time to list it for sale. The business owner can do this themselves or hire a real estate agent to help with the process.
If they’re selling the property themselves, they’ll need to create a listing and market it to potential buyers. This includes taking photos, writing a description, and setting a price.
If they’re hiring a real estate agent, they’ll need to find someone experienced in selling commercial or residential properties. The agent will help with all aspects of the sale, from creating the listing to negotiating with buyers.
The closing process
Once a buyer is found, the business owner must sign a purchase agreement. This document outlines the terms of the sale, such as the price, closing date, and any contingencies.
The buyer will also need to get financing to purchase the property. Once they have secured funding, the closing process can begin. This includes signing the purchase agreement and transferring the property’s title to the buyer.
After the sale
Once the property has been sold, the business owner will need to remove any personal belongings and vacate the premises. They should also provide the new owner with any keys, manuals, or other documents that they’ll need for the property.
Mistakes to avoid
To ensure a smooth selling process, here are some mistakes to avoid:
Pricing the property too high
If a business owner prices their property too high, it could sit on the market for a long time without any buyers. This is why it’s crucial to have a realistic asking price.
Not preparing the property for sale.
If a business owner doesn’t take the time to repair and clean their property, it could turn off potential buyers. This could lead to a lower sale price or the property not selling.
Failing to market the property
If a business owner doesn’t market their property, they may have a hard time finding buyers. This is why it’s crucial to create a listing and promote the property to potential buyers.
Not using a real estate agent.
If business owner is selling their property themselves, they may not be familiar with the process. This could lead to mistakes being made, such as pricing the property too high or not marketing it properly. A real estate agent can help avoid these mistakes and guide the business owner through selling.
Selling a business’s real estate assets can be a complex process. However, business owners can ensure a smooth transaction by understanding the key elements. By avoiding common mistakes, such as pricing the property too high or not preparing it for sale, business owners can increase their chances of getting a reasonable price for their property.